201410.29

Transcript – Interview with Justin Smith, 2UE

E&OE………………………………………………

Subjects: ACCC, carbon tax repeal
JUSTIN SMITH:

And to another part of the Government, they promised to repeal the carbon tax; they did just that but now they’re going after the airlines for not passing on the carbon tax savings. Qantas and Virgin Australia and Regional Express are in the guns with the Government for not doing this. The ACCC is stepping in. Bruce Billson, the Small Business Minister is on the line.

Hello Minister.

MINISTER BILLSON:

G’day to you Justin and your listeners.

JUSTIN SMITH:

Thanks very much for your time. What are they not passing on here?

MINISTER BILLSON:

Well we’ve just had the third carbon tax repeal monitoring report from the ACCC, and pretty encouraging evidence that carbon tax repeal savings have been identified and passed on overwhelmingly in the way that is acceptable from electricity and gas but…

JUSTIN SMITH:

What is the average repeal that we would get?

MINISTER BILLSON:

It varies on the basis of who your providers are.

In the table that they’ve provided it summarises what’s happening for New South Wales for instance, your listening audience, you’ve got a range of providers where the residential savings are between about 7.5 per cent up to about nine or 10 per cent, depending on…

JUSTIN SMITH:

So 7.5 to sort of 10 per cent off your energy?

MINISTER BILLSON:

That is right. That is on your electricity and then for small businesses it is a bit higher again, and then on gas we see a similar picture of the providers properly calculating savings.

Those are around sort of 4.5 to 5 per cent generally and again a little bit higher for small businesses so that seems to be going quite well but if any of your listeners haven’t got a full pass through, give the ACCC a call 1300 303 609.

The report also identifies areas where there is ongoing work in relation to the domestic airlines.

I think you and your listeners and certainly people paying for travel bills would have seen a mention of a carbon tax levy, or impost, attached to those transactions after the introduction of the carbon tax. Now that the carbon tax has come off we’re expecting the savings to be passed through to consumers.

The airlines have told the Commission that they’re not sure there is any savings to be found. If I could be as delicate as possible, there is rather a sceptical and curious eye being run over those claims.

JUSTIN SMITH:

My radar might be off a little Minister, you don’t buy that do you?

MINISTER BILLSON:

Oh I think it’s not the most credible thing I’ve heard this week and what is happening now with the tools and teeth and the additional resources the ACCC has been given, they’ve gone back to the airlines saying…

JUSTIN SMITH:

Hang on a sec though, didn’t you guys promise some pretty hefty fines to people who weren’t passing on the carbon tax repeal, why don’t you start fining Qantas, Virgin Australia and Regional Express?

MINISTER BILLSON:

Well little ahead of the game, right now they’ve made some claims, they’re a little bit unpersuasive – might be the most delicate way I could put it. The Commission has gone back to the airlines and they will continue to seek an explanation for what is not a very convincing assertion.

JUSTIN SMITH:

Well what are we waiting for Minister? We’ve got Regional Express admitting they haven’t passed on the carbon tax. If I went into the police station and admitted that I held up a convenience store I would have to pay for that, in fact they wouldn’t need a lot more else, they’d say five years please and away you go.

MINISTER BILLSON:

Yeah, I think the prima facie of rocking into a store and lifting something are not quite transportable here but there is certainly a high degree of awareness that those representations are a little hard to reconcile and that is why the ACCC has gone back to the airlines saying you’ve made these representations, these are the things that you’ve said, show us the evidence that you’re basing your claims on. And then there’s a range of further actions available to the Commission.

JUSTIN SMITH:

Minister, it’s a little weak isn’t it, you talk tough, you as in the Abbott Government talk tough about fining people who didn’t pass that on, you’ve got big companies admitting they have done the wrong thing, you’re toothless on this aren’t you?

MINISTER BILLSON:

No I think that’s a popular radio line Justin. The tools are there. Our primary focus in the first instance in phase one was to get those energy savings through to demand…

JUSTIN SMITH:

You also said there were fines for these things.

MINISTER BILLSON:

Yes, and there are a couple in that category that are there, then there is a second tier that have made representations or where there may be flow through effects in the transport sector, in the aviation sector, in some of the production and manufacturing areas as well. And that is also the focus of the Commission, so it’s not as if there is nothing happening, there’s plenty happening.

The Commission’s gone to the airlines saying we’ve seen you make those claims in good orderly process, they’re seeking evidence from the airlines to substantiate their claims and if it continues to be unpersuasive there’s a toolkit available to enforce the pass through.

JUSTIN SMITH:

Alright so tell me about the toolkit. Let’s say Regional Express – they’ve admitted they haven’t passed on savings here, you write them a letter or the ACCC writes a letter saying ‘Hey start passing it on’ and they say we’re not going to do it, what’s the time that you can give them?

MINISTER BILLSON:

Well then you’d exercise the false and misleading representation provisions of the law and you’ve touched on the scale of those fines, they can be very substantial.

JUSTIN SMITH:

Would you be asking them to repay all the money that they should have been paying right now?

MINISTER BILLSON:

Well in some cases part of what the Commission has done and let’s think of things like land fill operators, people involved in garbage collection and the like, where funds have been collected and not returned, and that’s part of the Commission’s work, to make good that error and to make sure those savings are passed through and as the Commission chairman Rod Sims has said what’s gone up as a consequence of the carbon tax being introduced needs to come down as a consequence of it being repealed and that’s the approach…

JUSTIN SMITH:

Let me give you another popular Australian radio line and say thanks for joining us.

MINISTER BILLSON:

Ah good, take care.